Ministerial decree to assure wages punctual payment starts Monday (Oct 3rd)
The Ministry of Human Resources and Emiratisation started implementing the newly launched wages protection decree today (October 3rd), the decree, which was launched by H.E Saqr Ghobash, the Minister, ensures employees’ full payment of their salaries on time.
Maher Al-Obed, Assistant Undersecretary for the Inspections Sector, pointed out “The decree fairly contributes towards labour market stability as it safeguards employees while keeping business owners interests, salaries paid on time is a major contribution towards labour rights protection which is highly recognized by the UAE.”
“We value such decisions as it promotes labour relations which in turn secures a balanced labour market productivity, and eventually turns out with positive outcomes for both labourers and employers,” he said.
The decree highlights companies employing over 100 workers. Such companies must pay wages within a period not exceeding 10 days from the registered payday in the (WPS) wages protection system, if they fail, the ministry will stop granting them any additional work permits starting from the 16th day of delay.
“Two main scenarios should be considered in this matter, firstly, salary delays occur usually if the company fails to pay wages a month from the due date, the second, which refers to completely refraining wages, starts after entering into the second month, however, the decree shall refer to each case in a different matter,” Al-Obed said.
The decree states, if a company delays wages a month from the due date, which means the company has entered into refrainment period, the ministry shall inform the judicial authorities and other related parties to take all necessary punitive measures against the violating company, additionally, the ministry halts other companies owned by the same employer, plus forbid any upcoming projects foreseen by the same owner.
Furthermore, if a company continues to refrain wages, the ministry shall take necessary measures to use the company’s bank guarantee, then slapped by a downgrade to a third category company, plus enable their workers’ mobility options to other companies.
“If the company fails to pay wages for 60 days from the due date, then administrative fines shall follow, in addition to registered fines for failing to pay wages a month from the due date, as stated above in the first scenario,” Al-Obed added.
Administrative fines reach Dh5000 (AE dirhams) per worker’s delayed wage pay, stretching a maximum of Dh50,000 dirhams in events which include multiple workers protesting about deferred wages past 60 days.
Fortunately, the ministry lifts bans on violating companies allowing them to apply for new work permits only if they promptly paid deferred wages during the first late month, while the ban lasts for 60 days if companies fail to fund wages for more than two months.
According to the decree, companies that pay refrained salaries yet record such violations repetitively shall face a doubled duration ban.
On the other hand, if the ministry notes salary delays or refrains by a company that employs less than 100 employees, the current regulations shall apply, which includes work permits ban to fines to court referrals, however, only if the company fails to pay wages within 60 days. If the company repeats such violations over the span of one year, then, in this case, the ministry shall apply penalties declared for companies hiring over 100 workers.
The decree clearly states that the ministry shall not proceed with any transactions with companies that did not register in the (WPS), in addition, owners of these companies would be kept aside until the registration in the (WPS) is completed.